#PENALTY ON A COMPANY FOR DELAY IN CIRCULATING BOARD MEETING MINUTES

In a recent adjudication order, the Registrar of Companies imposed penalties over Rs 1 lakh on a Company and its Directors combined for failure to circulate Board meeting minutes before fifteen days as required under Secretarial Standard 1.

Clause 7.4 of SS1 says: "Within fifteen days from the date of the conclusion of the Meeting of the Board or the Committee, the draft Minutes thereof shall be circulated by hand or by speed post or by registered post or by courier or by e-mail or by any other recognized electronic means to all the members of the Board or the Committee, as on the date of the Meeting, for their comments."

It was found that the Company circulated minutes almost after one month and two months of two board meetings. This is a substantial violation of secretarial standards.

The Ministry of Corporate Affairs (MCA) has invoked Section 118 of the Companies Act, 2013, to impose penalties on Blue Sapphire Healthcares Private Limited for the delayed circulation of draft minutes of its board meetings.